Venture capitalist Bill Gurley is bullish on bitcoin because he views it as a more secure place to keep money in areas of the world with political and economic dysfunction.

"I think of it as an incredible store of value in the rest of the world," said Gurley, in an interview on CNBC's "Squawk Alley" on Friday. "I don't think it's irrational."

The price of bitcoin is up almost eight-fold this year to $7,877. The total value of the bitcoin currency in circulation is close to $132 billion.

Bankers and institutional investors ranging from JPMorgan CEO Jamie Dimon to Allianz's Mohamed El-Erian have questioned the value and utility of cryptocurrencies, with Dimon going so far as to call it a "fraud" that's bound to blow up.

Gurley said bitcoin is not a fraud and said Benchmark, his Silicon Valley firm, has a very small position in the currency.

Bitcoin is particularly useful in parts of the world where governments often change the value of their currency overnight and where there are few if any trustworthy institutions to keep your cash and savings.

"Many people who live in those types of countries want to be paid in bitcoin," Gurley said.

Gurley was in New York on Friday for the public market debut of online retailer Stitch Fix. Benchmark owns 22 percent of the company -- a stake valued at about $388 million -- and Gurley sits on the board.

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Bitcoin is an incredible store of value for the rest of the world: Benchmark Capital's Bill Gurley